Abra Agrees to Refund Texas Investors
Following allegations of unregistered securities offerings, crypto lender Abra has reached a settlement with the Texas State Securities Board (TSSB). As part of the agreement, Abra will return assets to Texan investors, while other U.S. clients will also have the opportunity to reclaim their investments.
Regulatory Scrutiny and Settlement
The settlement comes after the TSSB conducted an investigation into Abra's interest-bearing cryptocurrency products, Abra Boost and Abra Earn. The TSSB's Enforcement Director, Joe Rotunda, led the enforcement actions, accusing Abra and its affiliates of offering these products without proper registration, potentially exposing investors to risk.
Refund and Obligations
Under the settlement, investors will be able to withdraw their assets from Abra accounts. Additionally, Abra is required to convert unclaimed assets to fiat currency and send checks to Texas investors. The company has been given a 30-day period to fulfill these obligations from the date of the settlement.
Abra's Operations and Programs
Abra, operated by Plutus Financial Holdings Inc., Plutus Financial Inc., Plutus Lending LLC, and Abra Boost LLC, offered its interest-bearing cryptocurrency programs to U.S. clients. Abra Boost specifically targeted accredited investors. Through these programs, investors could earn interest by depositing digital assets with Abra, which were then loaned to institutional borrowers.
Investigation Findings
The TSSB's investigation, which began in June 2023, revealed that Abra held cryptocurrencies worth approximately $13.6 million on behalf of over 12,000 U.S. investors, including $1.8 million from about 1,600 Texas residents. Following the enforcement actions, Abra initiated the winding down of its U.S. retail operations, a process that is now expedited by the settlement.
Consent Order and Dismissal of Actions
In addition to returning assets, Abra and its leader, William "Bill" Barhydt, have agreed to a Consent Order by the Securities Commissioner. The settlement is contingent upon Abra successfully fulfilling the terms and will result in the dismissal of actions filed against the company since June 15, 2023.
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By: David Sencil
Title: Crypto Lender Abra Settles with Texas Investors, Commits to Asset Return
Sourced From: news.bitcoin.com/crypto-lender-abra-to-return-assets-to-texas-investors/
Published Date: Thu, 25 Jan 2024 20:30:12 +0000
